By Adv. R. S. Agrawal :
If the plaintiffs had a genuine grievance of non-payment of the balance sale consideration, the plaintiffs could have moved for revocation of the permission granted by the. The plaintiffs did not make any complaint whatsoever to the Collector at any point of time. The conduct of the plaintiffs is reflective of lack of bona fide. The plaintiffs have failed to discharge the onus of proof that the suit was filed within the period of limitation. The present suit is clearly an abuse of the process of the court, and bereft of any merit.
IN THE Judgment of the case – Dahiben v. Arvindbhai Kalyanji Bhanusali (dead) through Legal Representatives & Others, delivered on July 9, 2020, Justice L. Nageswara Rao and Justice Indu Malhotra, at the Supreme Court, have affirmed the judgements of the courts below from Gujarat and held that provisions of Order VII, Rule 11 of the C.P.C. relating to rejection of plaint are mandatory in nature. According to the Supreme Court, if the case made out in the plaint is to be believed, it would mean that almost 99 per cent of the sale consideration, that is, Rs 1,73,62,000/- allegedly remained unpaid throughout.
It is, however inconceivable that if the payments had remained unpaid, the plaintiffs would have remained completely silent for a period of over 5 and half years, without even issuing a legal notice for payment of the unpaid sale consideration, or instituting any proceeding for recovery of the amount, till the filing of the present suit in December, 2014. The plaintiffs have made out a case of alleged non-payment of a part of the sale consideration in the plaint and prayed for the relief of cancellation of the Sale Deed on this ground. The definition of ‘Sale’ under Section 54 of the Transfer of Property Act, 1882, indicates that there must be a transfer of ownership from one person to another, that is, transfer of all rights and interest in the property, which was possessed by the transferor to the transferee.
The transferor cannot retain any part of the interest or right in the property, or else it would not be a sale. The definition further indicates that the transfer of ownership has to be made for a “price paid or promised or part paid and part promised”. Price thus constitutes an essential ingredient of the transaction of sale. In its decision of the case- Vidyadhar v. Manikrao & Another –(1999) 3 SCC 573, the Supreme Court has held that the words “price paid or promised or part paid and part promised” indicate that actual payment of whole of the price at the time of execution of the Sale Deed is not a sine qua non for completion of the sale.
Even if the whole of the price is not paid, but the document is executed, and thereafter registered, the sale would be complete and the title would pass on to the transferee under the transaction. The non-payment of a part of the sale price would not affect the validity of the sale. Once the title in the property has already passed, even if the balance sale consideration is not paid, the sale could not be invalidated on this ground. In order to constitute a “sale”, the parties must intend to transfer the ownership of the property, on the agreement to pay the price either in praesenti or in future. The intention is to be gathered from the recitals of the sale deed, the conduct of the parties, and the evidence on record. In view of the law laid down by the Supreme Court, even if the averments of the plaintiffs are taken to be true, that the entire sale consideration had not in fact been paid, it could not be a ground for cancellation of the Sale Deed.
The plaintiffs may have other remedies in law for recovery of the balance consideration, but could not be granted the relief of cancellation of the registered Sale Deed. The SC’s finding is that the suit filed by the plaintiffs is vexatious, meritless, and does not disclose a right to sue. The plaint is liable to be rejected under Order VII, Rule 11(a). The plaintiffs have stated in the plaint that the period of limitation commenced on November 21, 2014, when they obtained a copy of the index of the Sale Deed of July2, 2009, and discovered the alleged fraud committed by the defendant – 1. The plea taken in the plaint that they learnt of the alleged fraud in 2014, on receipt of the index of the Sale Deed, is wholly misconceived, since the receipt of the index would not constitute the cause of action for filing the suit. It is clear from the plaint that the cause of action arose on the non-payment of the bulk of the sale consideration. Which event occurred in the year 2009.
The plea taken by the plaintiffs is to create an illusory cause of action, so as to overcome the period of limitation. The plea raised is rejected as being meritless and devoid of any truth. The conduct of the plaintiffs in not taking recourse to legal action for over a period of five and half years from the execution of the Sale Deed in 2009, for payment of the balance sale consideration, also reflects that the institution of the present suit is an after-thought. The plaintiffs apparently filed the suit after the property was further sold by respondent-1 to respondents 2 and 3, to cast a doubt on the respondent – 1 to the suit property.
The plaintiffs have placed reliance on the order of the Collector, of June 19, 2009 with the plaint. The Order reveals that the permission was granted subject to the fulfillment of certain conditions. Clause 4 of the permission states that: “(4) The purchaser of the land/property shall have to make payment of the price of land by cheque and its reference shall require to be made in the Sale Deed.” If the plaintiffs had a genuine grievance of non-payment of the balance sale consideration, the plaintiffs could have moved for revocation of the permission granted by the Collector on June 19, 2009. The plaintiffs did not make any complaint whatsoever to the Collector at any point of time.
The conduct of the plaintiffs is reflective of lack of bona fide. The present case is a classic case where the plaintiffs by clever drafting of the plaint, attempted to make out an illusory cause of action, and to bring the suit within the period of limitation. They deliberately did not mention the date of the registered Sale Deed- July 2, 2009, executed by them in favour of respondent -1, since it would be evident that the suit was barred by limitation.
The omission of the date of execution of the Sale Deed on July 2, 2009 in the prayer clause, was done deliberately and knowingly, so as to mislead the court on the issue of limitation. In the opinion of the apex court, the plaintiffs have failed to discharge the onus of proof that the suit was filed within the period of limitation. The plaint is therefore, liable to be rejected under Order VII, Rule 11(d) of C.P.C. The present suit is clearly an abuse of the process of the court, and bereft of any merit. The Supreme Court has dismissed the civil appeal with costs of Rs one lakh payable by the appellant to the respondents – 2 & 3 within 12 weeks from the date of the judgement.